In order to study the molecular mechanisms involved in signal transduction and regulation of the catalytic activity of the erbB- 2 receptor protein, a series of mutants in different structural domains of the gene product were generated. Mutated molecular clones were expressed into NIH/3T3 cells in order to assess their biologic activity in a focus assay. We found that two different classes of structural alterations, i.e., an NH-2 terminal deletion and a Val 659 to Glu or Val 659 to Asp mutation, are capable of upregulating the transforming potential of the erbB-2 product. Mutant proteins exhibit an increased level of in vitro tyrosine kinase activity as well as an increased level of in vivo phosphorylation on tyrosine residues. These results indicate that deregulated tyrosine kinase function is a major determinant of erbB-2 receptor oncogenic activity. We are currently investigating the role of tyrosine autophosphorylation in the modulation of the erbB-2 receptor catalytic activity by analyzing the biological and biochemical behavior of mutant proteins lacking one or more of the tyrosine residues which are believed to be targets of autophosphorylation.